Reflections on Post-Communist Central Europe

Michael Werbowski, March 4, 2009

A youth walks past one of the few remaining segments of the Berlin Wall (1961—1989) on Bernauer Strasse, in Berlin, Germany. (Photo: John MacDougall / AFP-Getty Images)

Karl Koecher, Ph.D., was formerly a top spy for the Czechoslovak intelligence service. As a key player in the final decade of the Cold War, he was one of the only "moles" to infiltrate the C.I.A. in his career as a double agent. On February 11, 1986 Koecher and his wife were exchanged in Berlin, Germany, for prominent Russian dissident Anatoly Shcharansky. He resides in Prague and agreed to do an interview with me recently — 20 years after the fall of the Berlin Wall.

Q: How would you assess the past 20 years of transition in central Europe? Specifically in the Czech Republic. Have the two decades of economic reform driven by the neo-liberal dogma improved the lot of the average Czech citizen?

A: Obviously, you have in mind the transition in four countries — the Czech Republic, Slovakia, Hungary and Poland. In those four countries themselves, the group is usually referred to not as "central European" — a category that does not quite fit all four and also has a historical context which could invite some misleading generalizations — but as the Visegrad Four (V4). The name comes from Visegrad, Hungary, where Hungary, Poland and then-still existing Czechoslovakia declared their intention — so far largely unfulfilled — to cooperate in the matters of European integration.

From among the four, the Czechs stand out as a nation having much less in common — economically, as well historically — with the other three than they themselves have with one another. Their industrial economy has a tradition going back to the 19th century, and even during the Communist era belonged to the strongest in the Soviet bloc. The Czechs also have had no fascist past of their own making. To the contrary, as the majority nation in pre-World War II Czechoslovakia, they were the champions of the only democratic government in the respective area, and their thoroughly secular political culture (70 percent Czechs are avowed atheists) has been free, at least until very recently, of nationalistic extremism.

In view of that, it might have been expected that the Czech transition to an open society, a free market economy, and its integration into the European community would be a smooth ride in which the Czechs would come well ahead of the Visegrad Four. This, however, did not come to pass. The history of that transition is a history of the liquidation of many, if not most, Czech flagship industries, such as the Poldi Steel Mills, the Skoda armament manufacture, and the near liquidation of many others, among them Bohemian crystal production. The principal privatization campaign, which began in 1991 according to the blueprints of Vaclav Klaus and his collaborators, has led, due to the looting by the new owners, to the disappearance without a trace of assets totaling some 600 billion koruna — an amount about one and a half times the national budget expense of the Czech Republic for 1991.

Interestingly, the disastrous privatization drive took place only in the Czech half of the country. The then-already highly autonomous Slovak authorities eventually chose not to participate in it. The privatization of the banks led to further plunder, which cost the government in bail-out packages alone some 400 billion koruna. And while there had been a change in the government — the Social Democrats replacing Klaus' right-wing Civic Democrats — it had no effect on the looting of national assets. It went on under both, unabated and practically unpunished, partly because of judicial graft and partly because of the dismal inefficiency of the system of justice still staffed mostly by Communist-era justices.

Nevertheless, the Czech national economy was growing until recently at the fastest rate among the V4. However, that had been due largely to the activities of foreign investors attracted temporarily by the good skills of the Czech labor force and substantially lower wages than in the E.U. core countries. Right now, that economic growth is coming to a screeching halt with predictions of industrial growth for 2009 near or even below zero — a testimony to a promising potential shamelessly wasted.

The crucial question is, of course, how could this have happened? The more so that it was not happening behind the public's back; the mass media, regardless of their ideological preferences had been reporting on the transition woes by and large faithfully, and in detail. Surely, there are numerous factors that have contributed to this state of affairs, but in my opinion, one circumstance towers above all other from the very beginning of the transition process: the appearance of a new political elite, which did not emerge from any standard political constituencies, but managed to avail itself of political power simply because of being at the right place at the right time, and then went on to make use of it in the service of its own particular interests.

This phenomenon of a leadership without a constituency has been particular only to Czechoslovakia. Poland entered the post-Communist era with a leadership which has proven its leadership qualities in carrying out a mass-supported struggle with the pro-Soviet elements in the government, and in Hungary during the last years of the Communist rule a reform-minded faction of the Communist Party was enjoying considerable support of the public. The reason that the situation was so different in Czechoslovakia had been the paranoid fear of the ultra-conservative Communist Party top apparatus of a reform movement following in the footsteps of the "Prague Spring," whose crushing by the Soviet invasion had been the foundation of their positions of power. They spared no effort to make sure that nobody who could challenge their positions would acquire any office or form a platform for channeling public dissent.

Consequently, when the end came, there simply wasn't anybody with leadership qualities available to chart and safeguard the rules for a non-problematic transition. It can be, of course, argued that there had been Vaclav Havel and the Charter 77 group headed by him, as well as several protagonists of the Prague Spring, including its best known personality Alexander Dubcek. As for the idea that Charter 77 had been in the Communist Czechoslovakia a political movement enjoying public support, and Vaclav Havel a dissident leader of any renown is but a myth The activities of Charter 77 consisted exclusively of declarative statements of dissent and petitions for observance of civil rights, none of which represented any political program or even sparked any public protest actions, and went entirely unnoticed by the general public at home. The myth of an influential movement and leadership in the struggle against Communist rule is entirely due to the publicity which Charter 77 enjoyed in the Western media. As for the surviving protagonists of the Prague Spring, the twenty years in isolation from political life and unpreparedness for a merciless power struggle to fill the power vacuum made them easy victims of a joint effort to exclude them from public life by an alliance formed just for that purpose by the Vaclav Havel's set and the newly emerging groups aspiring for political offices. For Vaclav Havel it meant becoming the country's president instead of Alexander Dubcek, despite the fact that Havel was, unlike Dubcek, for the Czechs and Slovaks virtually unknown.

His presidency, however, did not represent any genuine leadership and had no impact on the lot of the average citizen. The political force which affected that lot were above all the neo-liberals, who in 1991 launched the privatization drive which played into the hands of the "robber barons." Did the neo-liberals improve the lot of the average man in the street? For most of the people their lot undoubtedly improved, though not for that many — only slightly more than half of the respondents in the opinion polls believe that they are better off now than they were at the end of the Communist era. However, that improvement did not take place thanks to the efforts of the neo-liberals, but despite them.

There have been economic disturbances in Hungary and the Ukraine recently. Both countries requested an I.M.F. bail-out to keep their economies afloat.There have also been street protests in the Baltics and Bulgaria. What in your view are the sources of this popular unrest?

Anger, naturally — at losing jobs, corrupt and mendacious government officials, rising criminality, etc., etc. The really interesting question, however, is why people in those countries feel that it makes sense to vent it publicly and collectively. For I strongly doubt that similar outbursts could take place also in the Czech Republic. Of course, the impact of the crisis has been so far much milder here, but even if matters got much worse, I do not believe that the Czechs would take to the streets and riot. How come? There can be, of course, only a highly speculative explanation, but in my opinion the reason lies in the long history of vain mass displays of collective unanimity embedded in the Czech collective memory — the futile manifestations at the time of the signing of the Munich agreement demanding; armed defense against Nazi Germany; vain mass demonstrations against the invading armies sent to crush the Prague Spring; and, not in the least, also the forlorn hopes for honorable government and a socially just society of the Velvet Revolution. Sure, public ills make the Czechs angry like everybody else, but when they do, they sulk silently and in private.

Was the Czech-Slovak split a good thing for both states? Some say it was done deliberately to weaken what was once a much larger and functional federation, which had more economic clout in the world than the two separate states do now.

I myself am convinced that the split was in the best interests of both states. Although the Czech and Slovak languages are very similar and our lifestyles appear to be more or less the same, there is a marked difference between our social cultures. Among other things, the Slovaks are, unlike the Czechs, passionately nationalistic. The Roman Catholic Church exercises a strong influence on their lives, and, as all young nations which have only recently asserted their self-determination, have a much more alert public consciousness than the skeptical Czechs.

Their position as a minority nation in the former Czechoslovak Republic made them perpetually fear that the Czechs were trying to dominate them, and the mutual coexistence had been far less than harmonious before World War II, as well as during the Communist era. After the fall of the latter, the common state became almost nonfunctional, especially after the establishment of a federal arrangement in which the Slovaks had a very strong degree of autonomy. Surely there were powers that were delighted by the fact that the split replaced an economically — and also politically, as far as international relations were concerned — stronger entity by two weaker ones. The Federal Republics of Germany and Austria, or the Vatican, for instance, might well fit onto that category.

But even if there were outside forces actively supporting the Slovak separatists who finally pushed the separation through, all that they could do, in my opinion, was nothing more than to precipitate the split, which was inevitable, by a few years.

Transparency International rated corruption on the same level as Nigeria in the Czech Republic. Why has this blight become so pervasive in the country?

In search of an explanation, we have to go back to the last few years of the Communist regime and its economic underworld providing services which the regime was not able to provide itself — in the first place, a viable hard currency exchange. The rigid, absurdly bureaucratized banking system could not satisfy the currency needs of the increasing numbers of tourists coming to the country from the West, nor provide the Czechoslovaks granted exit visas sufficient amounts of Western currency at market rates. So it silently tolerated currency black marketeers who did not have any problem taking care of both, and the currency black market swiftly expanded, acquiring in the process more and more of the organized crime character, with a few big dealers amassing huge fortunes and enforcing their rules by violence. After the collapse of the regime, they became the core of organized crime in the new post-Communist state.

Having understandably no pro-Communist sympathies, they welcomed the "Velvet Revolution" and the rise of the new funds and contacts lacking leadership, totally ignorant of government business which provided them with an opportunity of a lifetime — an opportunity to endear themselves to, and eventually corrupt, significant numbers of government officials, and to push through the appointments of their associates into selected positions. Thus the political establishment and organized crime became intertwined, corruption ran rampant, and since the corruption process has affected both major political parties, there is no remedy in sight even if the government changes. There are simply no political forces capable or willing to put an end to it.

Many Czechs see the E.U. as a large invasive and authoritarian body. President Klaus has even compared it to the former Soviet Union. Why are Czechs so hostile to the E.U. in your view?

Maybe many, but certainly not most, despite the forceful attempts of President Klaus and his political allies to brainwash the public. According to an about two-week old opinion poll, Czech membership is perceived as a good thing by 46 percent of the respondents, but that formulation can be misleading. The same poll established that over 40 percent of the respondents are, as far as Czech membership in the E.U. is concerned, undecided, and only 12 percent see it as a bad thing; which in my opinion means that altogether 86 percent of the Czechs are not hostile to the E.U. And 46 percent of outright supporters is not such a dismally small figure, and could easily change for the better with more E.U. funds being made available — which is in the offing.

After all, the European average of E.U. supporters is only 7 points higher, 53 percent. As for the Klaus-sponsored anti-E.U. crusade, I am convinced that the true reason behind it is a desire to avoid accountability on an international level for the spate of illicit business practices, judicial abuses and corruption benefiting certain particular interest groups.

Will the Obama presidency change Czech-American relations? Might the new president renounce plans for an American-funded radar site in the country?

I don't think that the Obama presidency will mean any substantial changes in Czech-American relations. The pro-American lobby here is guided by particular interests which will remain unaffected by the change in American administration, and the United States has no reason to reassess its relations with us, as the Czech government's attitude toward the U.S. is as servile as humanly possible. As for the America radar, I believe that it will never be built here. which is just as well, since at least two-thirds of the population is opposed to it. In my opinion, the primary motive behind the plans to build it had been the now defunct desire to provide lucrative business deals to firms supporting President Bush. If the U.S. still discusses the plan with the Russians, it is, in my opinion, only to negotiate the price for which it will be willing to formally bury it.

What are the greatest challenges facing the Czech Republic during its E.U. presidency?

Not to appear as incompetent parochial dummies, but I am afraid that this is a task well above the head of the current Czech government.

Is there any nostalgia among Czechs for the old Cold War days in the country, when people had far less freedom and consumer choices, yet life was more predictable and there was less social and economic stress as there is today?

Yes, to some degree such a nostalgia does indeed exist as evidenced, for instance, by the fact that the Czech Communist Party is the third-strongest party in the country. In the 2008 elections to the regional representations, its candidates got 15 percent of the vote. But that number comprises only those with pronounced nostalgic sentiments — the number of those feeling a less pronounced, but still definite nostalgia, is probably higher. To make any reasonable estimate is, however, impossible — it is one of the questions that the polling agencies seem to be determined to avoid at any cost. A four-month old opinion poll asking the respondents whether they are satisfied with the direction in which the Czech society is moving, 30 percent said that they are satisfied with it, 35 percent were definitely dissatisfied, and the rest thought that there was no discernible direction in which the Czech society is moving. It may well be that a substantial part of those not happy with the course that the country is taking foster some sympathies for the old times.